Equinix has introduced a new Executive Severance Plan that standardizes severance benefits for its senior executives, excluding the CEO, and simultaneously updated the CEO’s severance agreement to align more closely with this new framework. These changes aim to create a clearer, more consistent approach to executive separation benefits, reflecting current market practices and providing enhanced protections for executives in the event of termination or a change in control.
Key details of the new Executive Severance Plan:
- The plan applies to eligible executives, including all executive officers except the CEO.
- It replaces all previous severance arrangements for these executives, establishing a uniform policy.
- If an executive is terminated without cause or resigns for good reason (outside of a change in control event), they receive:
- Severance pay equal to their annual base salary plus target bonus, paid over 12 months.
- Any earned but unpaid bonus from the prior fiscal year.
- Continued vesting of outstanding equity awards for 12 months post-termination.
- Continued group health coverage or COBRA premium payments for up to 12 months for the executive and eligible dependents.
- Outplacement services valued up to $10,000.
- If termination occurs within three months before or 12 months after a change in control, the executive receives enhanced benefits:
- A lump sum severance payment equal to two times the sum of base salary and target bonus.
- Any earned but unpaid bonus from the prior fiscal year.
- Full accelerated vesting of all outstanding equity awards, except those tied to performance conditions.
- Continued health coverage or COBRA payments for up to 18 months.
- Outplacement services valued up to $10,000.
- Severance payments require the executive to sign a release of claims against the company.
- The definition of “change in control” aligns with the company’s existing equity incentive plan.
Changes to the CEO’s severance agreement:
- CEO Adaire Fox-Martin is not included in the new severance plan but has an amended severance agreement effective February 6, 2026.
- Key updates to her agreement include:
- Removal of the previous three-year term limit on severance benefits.
- Introduction of continued vesting of outstanding equity awards for 12 months after termination, replacing prior pro rata vesting.
- Addition of outplacement services valued up to $10,000.
- These changes bring the CEO’s severance terms closer in line with those offered under the new Executive Severance Plan.
Additional context and implications:
- The new severance framework provides greater transparency and consistency in how Equinix handles executive departures.
- Enhanced benefits around change in control events reflect a competitive approach to retaining and protecting key executives during potential ownership transitions.
- By consolidating severance arrangements under a single plan (except for the CEO), Equinix simplifies its executive compensation governance.
- The CEO’s amended agreement maintains her distinct status but aligns key protections with those of other executives, potentially reflecting evolving corporate governance standards.
Overall, these updates clarify the company’s approach to executive severance, balancing competitive compensation with structured, transparent policies that support leadership stability and succession planning.